India Bats For Precise Ecommerce Trade Definition In WTO For Goods And Services

India has urged members of the World Trade Organization (WTO) to work on establishing a precise definition for ecommerce trade in goods and services.

This would offer the developing nations the latitude to formulate policies in the fast-growing ecommerce industry, an official told PTI.

Currently, a disparity in interpretations of this topic exists between developed and developing member countries within the WTO.

This matter was a topic of discussion during a gathering of WTO senior officials in Geneva, which took place last week.

“India stated that the definition should be clear about digital goods and services because customs duties are there on goods and not on services. The Western world wants no customs duties, and on the other hand, developing countries want that policy space to impose the duties,” the official told PTI.

Despite ongoing discussions among specific WTO members regarding ecommerce since 1998, a precise definition of this subject remains elusive. Notably, a coalition of 80 nations is engaged in negotiations to establish an agreement related to ecommerce, although India is not a part of this group.

Additionally, the US has recently chosen to withdraw from these talks aimed at formulating global regulations for ecommerce within the WTO.

WTO member countries have maintained a consensus since 1998 to abstain from imposing customs duties on electronic transmissions. This moratorium has been consistently renewed during successive ministerial conferences, which serve as the supreme decision-making authority for the WTO’s 164-member assembly.

“There is no clarity on ecommerce trade in services. So, because of the lack of clarity, there is an apprehension…To provide a level playing field, you need to impose customs duties,” the official added.

The official further added that India plans to once again contest the extension of the moratorium on customs duties in the realm of ecommerce trade at the upcoming 13th ministerial conference of the WTO, scheduled to take place in Abu Dhabi in February 2024.

Meanwhile, the Indian government is working on a national ecommerce policy which is expected to be introduced soon. Earlier in August, it was reported that the proposed national ecommerce policy is now in its concluding stages, and there are no plans to release any further draft policies to gather input from stakeholders. This forthcoming ecommerce policy is under development by the commerce ministry.

The government issued a draft ecommerce policy in 2019 to tackle a few critical facets of the ecommerce landscape. It proposed measures regarding data, including regulating cross-border data flow and ensuring the collection and processing of sensitive data within India. Infrastructure development in the ecommerce sector was another focus.

The draft also considered regulating ecommerce marketplaces and addressing regulatory issues like controlling the sale of counterfeit products and prohibited items.

Additionally, it sought to stimulate the domestic digital economy, potentially by supporting local ecommerce enterprises and promoting exports through ecommerce. The draft also suggested reviewing the practice of not imposing customs duties on electronic transmissions, given the changing digital economy.

As the Department for Promotion of Industry and Internal Trade (DPIIT) nears the completion of the ecommerce policy, the Consumer Affairs Department is concurrently engaged in crafting ecommerce regulations within the framework of the Consumer Protection Act.